Overview: 

Pennsylvania leadership and policy makers are actively courting the AI data center industry as part of their long-term economic development plan for the state. Consequently, municipalities—often limited in capacity and funding—are on the frontline, left to mitigate the impacts of the fast-paced, large-scale development of this relatively novel land use, which brings with it significant concerns regarding energy use, water consumption, and development of open space, just to name a few. What’s more, Pennsylvanians are watching their energy bills skyrocket while cheap, clean, fast-to-deploy renewables are being left out of the conversation.  

While PennFuture is working at the local, regional, and statewide level to address these impacts, state legislators have also put forward several bills in response to the needs of municipalities to protect communities and to the concerns regarding energy prices and resource consumption. PennFuture has thoughts on each of these bills, and we’re going to break it all down in this blog. And as a special bonus, we’ll even tell you about our public comments to the PUC supporting consumer protections against rising electricity costs. 

 

Now Let’s Break Down the Bills:

 

House Bill 1834 (HB 1834), Sponsor: Rep Robert Matzie [District 16] 

POSITION: Oppose unless renewable energy amendment is fixed

This bill directs the Pennsylvania Public Utility Commission (PUC) to create regulations around how data centers are developed in Pennsylvania and proposes increased investment in the Low-Income Home Energy Assistance Program (LIHEAP) and additional investments in community energy projects. Coming in at only 5 pages, the brevity of the original bill was an opportunity for stakeholders' engagement around potential amendments.   

The good part: the original bill was a mandate for at least 25% of electricity supplied under a contract between a public utility and a commercial data center must be generated from renewable energy sources, including solar, wind, biomass, or hydroelectric power. Consequently, because we know we can’t ban data centers in PA, PennFuture submitted written testimony in October 2025 highlighting our deep interest in leveraging clean, reliable, and affordable renewable energy to provide power to data centers. You can view our testimony in its entirety here.  

The bad part: there was an amendment added to expand the definition of renewable energy to also include nuclear energy, geothermal energy, and energy generated from a renewable natural gas device. Specifically, we do not believe that nuclear energy belongs here. Nuclear energy is a critical component of our energy portfolio and is certainly reliable, but it is not renewable.  

Nuclear energy already makes up roughly 33% of Pennsylvania’s energy portfolio, if it is included in the definition of “renewable” energy, it has the potential to skew the 25% renewable energy requirement, thereby actually resulting in more fracked gas fueled data centers.    

At a time when true renewable energy only makes up about 4% of our energy supply, we need to do more, now to increase our supply. PennFuture is committed to a clean energy future for Pennsylvania because clean energy sources are cheaper and faster to build, strengthen our electric grid, and bring down costs for consumers. Pennsylvanians are seeing their electricity bills skyrocket because of increased demand from energy-hungry data centers and our overreliance on unreliable fracked gas, which again failed ratepayers during our current cold spell.  

Sensible data center policy must include solutions to meet the need to diversify our energy portfolio and increase renewable energy generation.  

The state House of Representatives has a chance to follow through on the positive initial instinct contained in HB 1834, that included prioritizing true renewable energy and creating opportunities for low-income families to get support they need with their energy bills. PennFuture is calling for a fix on the renewable energy requirement by either increasing the 25% renewable share or reverting to its original goal of advancing true renewable energy-supported data centers. Otherwise, these massive data centers will result in more, unreliable fracked gas which will only further increase costs from consumers, and PennFuture must continue to oppose such legislation.

 

House Bill 2151 (HB 2151), Sponsor: Rep Kyle Donahue [District 113] 

POSITION: Supports with PennFuture proposed amendment 

Since the threat of data centers first turned its eye towards Pennsylvania, PennFuture has recognized the power of local municipalities to dictate where data centers can be built and mitigate the harm. We quickly created a Model Municipal Ordinance for Data Centers and a video series intended to educate local communities of the impacts and make it easy for local government to protect those communities.  

House Bill 2151 could provide another important tool to assist in ensuring that data centers are sited responsibly to minimize negative impacts on residents.  

Specifically, the bill directs the Center for Local Government Services within the Pennsylvania Department of Community and Economic Development (DCED) to create their own model ordinance that municipalities can leverage when they update their own zoning ordinances to prepare for data center development. While not diminishing the power of PennFuture’s model ordinance, the Center for Local Government Services is an already-trusted municipal partner and one with much greater reach than PennFuture. We’ve been working hard to get our model ordinance in front of municipal officials and community leaders, but we recognize our limitations as an organization. That’s why we see value in the state government developing its own model ordinance—its reach and capacity is greater than our own.  

Municipalities that hesitate to proactively draft and pass data center ordinances put themselves at risk of legal challenges, and ultimately, of losing control over where the project can be located within their community. We believe that our ordinances and our advocacy can work in tandem with what HB2151 proposes to protect more communities from the harmful impacts of data center development and to protect municipalities from the threat of litigation.   

That is not to say that we don’t have some reservations with handing over this authority in an administration that is so pro-data center and so pro-fracked gas. As we discussed in our 2023 report, “Economic Development Policy IS Environmental Policy,” the DCED has a history of financially smoothing the way for the fossil fuel industry to expand across the state. So, that's why we’ve asked the House Energy Committee to adopt an amendment that requires public participation as the ordinance is drafted and included if the ordinance is updated in the future. 

Many opponents of this bill have a fundamental misunderstanding of what it does: it is not mandatory for any municipality to adopt the model ordinance in any way, shape, or form. Nor would this directly insert the model ordinance into Pennsylvania state law under the Municipalities Planning Code (the statute that regulates how municipalities function).  

In a state where bans on any type of land use are essentially prohibited, and municipalities risk costly litigation if their ordinances don’t include appropriate consideration of new land uses (like data centers), model ordinances are a useful tool designed to help speed up the process of drafting an ordinance. A municipality can adopt the whole model ordinance, word for word, directly into their existing ordinance, or it can adopt sections of it while keeping the rest of their existing ordinance the same. This bill does not change that freedom. But it does have the potential to give municipalities a head start—just as PennFuture’s model ordinance does.  

Watch PennFuture President & CEO Patrick McDonnell testify in front of the PA House Energy Committee on February 2, 2026, on HB 2151 here: Instagram

 

House Bill 2150 (HB 2150), Sponsor: Rep Kyle Mullins [District 112] 

POSITION: Supports 

This bill establishes annual energy and water reporting requirements for data center facilities. This is a commonsense measure to provide policymakers and residents with a better understanding of the impacts of the data entering industry on our water and electric grid. 

Currently, Pennsylvania does not have a way to measure and sufficiently understand, let alone plan for, the electricity grid impacts associated with data center operations. By requiring the state to collect and analyze this information, we will be better able to forecast and manage the incoming large loads on the electric grid. It will also provide us with the necessary information on water withdrawal impacts so that we can more closely monitor and mitigate future harms.  

Currently, policymakers are making decisions about how to regulate data centers at a significant deficit. Data center developers typically do not share more information than is required by law, and frankly, this bill would expand what is required. Bottom line, this bill increases transparency and improves the ability of decision-makers to make truly informed decisions about how data center development could or should occur in Pennsylvania.

 

Bonus Track: PUC Large Load Model Tariff 

In addition to pushing for commonsense data center legislation, PennFuture submitted technical comments to the Pennsylvania Public Utility Commission (PUC) on their model large load tariff in December 2025.  

I know we’ve been hearing a lot about “tariffs” lately, but that’s not what this is. A “large load tariff” is a specialized electric rate structure designed by utilities to manage the high energy consumption of massive, new power users—such as data centers, industrial plants, or AI facilities—ensuring they pay for the specific infrastructure upgrades they trigger.   

You can read the comments here. 

Typically, the final regulation orders from the PUC come 2-4 months after the closing of the comment period. PennFuture will monitor and let our members know when the final order is released. 

In our comments, we called for: 

• Increasing Renewable Energy Generation: Data center electricity demand could result in the modernization and expansion of the grid. This requires the development of renewable energy plus storage.  
• Fair Fees & Payments: We support placing a fee on data centers that can be used to mitigate rising electricity costs for Pennsylvanians—especially low-income households.  
• Consumer Protection from Costs: Exit or early termination fees protect everyday people from paying for stranded assets, should a data center company choose to bail on its investments. It is vital that utilities are also not able to recover the costs of data centers through increasing costs to the average ratepayer.  
• More Community Input: The data center economy has been foisted on average Pennsylvanians. This industry is extractive; they use our land, water, and labor to send wealth elsewhere. We didn’t ask for this or the job losses we’re seeing from implementing AI. If Pennsylvania decisionmakers want to build data centers in the Commonwealth, we need to be a part of the process. That means no fast track permitting or expedited siting, but real community engagement and cumulative impact assessments. 

 

Conclusion:

Together, these legislative (with discussed amendments) and regulatory opportunities could better protect Pennsylvania residents and the Commonwealth’s natural resources from the inherent challenges associated with this data center development. PennFuture is actively engaged on each bill, and we will continue to engage with state lawmakers to seek improvements where necessary to truly prioritize a more sustainable future powered by 21st century energy sources that are cleaner, cheaper, and will help us keep the lights on.